4.1. EDSR 03-28-2017 - Laserfiche WebLink

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El .�.� Request for Action Ricer To Item Number Economic Development uthority Finance Committee 4.1 Agenda Section Meeting Date Prepared by General Business March 28, 2017 Amanda Othoudt,Director of Economic Development Item Description Reviewed by Jackson Hill Residential Suites Housing Tax Cal Portner, City Administrator Increment Financing Application Reviewed by Action Requested Review application and provide a recommendation to the Housing and Redevelopment Authority establishing a Housing Tax Increment Financing District No. 24 Background/Discussion The Jackson Hills Residential Suites project is a proposed 40-unit market-rate and affordable housing project on Jackson Street. The developer applied for Tax Increment Financing assistance through the establishment of a Housing TIF District to finance the portion associated with the affordable housing. Springsted completed a but for analysis and determined without TIF assistance the project would not proceed due to the income restrictions of occupants and insufficient cash flow to finance monthly expenses and debt service. The developer's proposed financial package includes long-term,private financing of$4,800,000 from Lakewood Mortgage, $300,000 in equity from Briggs Properties, Inc. and $400,000 in Owner Cash Equity from PLB Rev Trust, and $500,000 in Tax Increment Financing for a total estimated project budget of $6,000,000. The requested TIF term is 15 years. To qualify,at least 20% of the units would be occupied by persons or families with incomes no greater than 50% of county median income or at least 40% of the units would be occupied by persons or families with incomes no greater than 60% of county median income for the duration of the district. Staff completed the Housing TIF Worksheet which scored 28 points indicating the project is not eligible for TIF. The project meets criteria set forth in Section IV of the city's Tax Increment Financing Policy. Based on the Estimated Market Value of the project as calculated by Sherburne County,the project's EMV is approximately$3,310,000 or$82,800 per unit and didn't receive any points in this category. However,with a minimum assessment agreement,the developer could realize an EMV of up to $4,200,000 and receive enough points to meet the low-eligibility guidelines according to the policy. The scoring worksheet indicates that at this rating,the developer is only eligible for 65% of the request. Points were given based on conversations with the developer that the project will include a community volleyball court and that the developer will incorporate the goals of Energy City and include efficient design and materials in the construction of the project. i 0WEAED 6Y 4A R